The Chargé in Bolivia ( Woodward ) to the Secretary of State
[Received June 29—1 p.m.]
A–286. Export control procedure for Bolivia following recognition of Bolivian Government. For background please refer to Embassy’s [Page 503] telegram 1966, of December 16, 1943, 6 p.m.93 and airgram A–136 of April 4, 1944.
- While the Embassy has not yet consulted the Bolivian authorities, preliminary indications are that the Ministry of Finance, the Ministry of National Economy, the Banco Central and the Country Agency will wish to return to Plan A of decentralization as it was applied in Bolivia prior to December 20, 1943, with import recommendations required for all imports.
- It is apparent that Bolivian importers, wholesalers, distributors and commission agents will wish to see a suspension of the decentralization plan and a return to pre-war foreign trade practices in so far as practicable, with only the irreducible minimum of governmental intervention either by the United States or Bolivia. In this they are motivated largely by the long delay which they invariably encounter in the processing of applications for import recommendations at the Country Agency, by the considerable amount of clerical work involved in preparing import recommendations and by the requirement that they disclose confidential trade data on the import recommendations.
- It will be recalled that shortly prior to the Bolivian revolution of December, 1943, the Bolivian authorities had reluctantly agreed, subject to certain conditions which we never accepted, to the adoption of a modified plan of decentralized export control (Alternative III) to go into effect January 1, 1944,94 whereby certain commodities were to be exempted from the import recommendation requirement.
- While the Embassy and the local office of the Foreign Economic Administration find the data contained in import recommendations very useful in connection with commercial reporting, Proclaimed List work, requirements estimates and post-war trade promotion, the Embassy does not believe that these considerations justify the retention of a closer degree of emergency export control than the exigencies of the war situation demand. It now appears that there is no valid reason for maintaining a greater degree of export control over American shipments to Bolivia than is generally practiced in regard to American shipments to South American countries.
- The Embassy therefore, is inclined to use its influence in the direction of a relaxation of the decentralization plan in Bolivia provided the Department and the Foreign Economic Administration perceive no objection thereto. The Embassy believes that import recommendations might well be required only for commodities which are in tight supply in the United States and which could reasonably be placed on a critical or semi-critical list. The recent announcement that the target tonnage for Bolivia has been increased from 6,000 [Page 504] to 7,000 tons, reinforces the conviction that mandatory import recommendations for all commodities cannot be justified.
- However, the system of optional submission of unofficial import recommendations, which has necessarily prevailed during the period of non-recognition is haphazard and confusing to both exporters and importers. It should be abandoned at the earliest practicable moment in favor of a clear cut unambiguous procedure.
- The Bolivian authorities are desirous of using Plan A of decentralized export control as an implement of Bolivian domestic import and foreign exchange control. The trend toward closer control of non-essential imports and toward the conservation of foreign exchange resources by the Bolivian Government is increasingly apparent here. It is our belief, however, that use of our wartime export controls solely or principally to implement Bolivian domestic controls of imports and exchange which are not directly related to the prosecution of our war effort, would be a perversion of our emergency export controls and would be difficult to defend.
- The Embassy therefore requests authority to discuss this question immediately with the appropriate Bolivian authorities and to adopt the stand outlined herein. Please reply by telegram.
Wynn and Acton,96 Foreign Economic Administration, concur and request that FEA be informed and consulted.